Crowtel Ltd

Between 29 May 2015 and 15 May 2016 the Executive received 181 complaints concerning a glamour video subscription service, charged at £4.50 per week, operating on shortcode 84508 (“the Service”). 

Complainants variously alleged that the Service charges were unsolicited. In addition, the information supplied by the Level 2 provider showed that the Service had commenced operation on 21 May 2015, but it had not registered the Service shortcode 84508 with PhonepayPlus until 14 January 2016. 

The Executive raised the following potential breaches of the PhonepayPlus Code of Practice (the "Code"): 

• Rule 2.3.3 – Consent to charge
• Paragraph 3.4.14(a) – Failure to register a number

The Tribunal upheld the two breaches of the Code raised. The Level 2 provider’s revenue in relation to the Service was in Band 2 (£500,000 - £999,999). The Tribunal considered the case to be very serious and imposed a formal reprimand, a fine of £150,000, and a requirement that the Level 2 provider remedy the breach by ensuring that it has robust verification of each consumer’s consent to be charged before making any further charge to consumers, including any existing subscribers to the Service. The Tribunal also imposed a requirement that the Level 2 provider seek compliance advice on its mechanism for obtaining robust verification of consent to charge, such advice to be implemented before charging any new or existing customers for whom there is no adequate existing evidence of consent to charge, and in any event within 28 days of publication of this decision (subject to any extension of time agreed with PhonepayPlus) to the satisfaction of PhonepayPlus. The Tribunal also imposed a requirement that the Level 2 provider must refund all consumers who claim a refund, for the full amount spent by them on the Service, within 28 days of their claim, save where there is good cause to believe that such claims are not valid, and provide evidence to PhonepayPlus that such refunds have been made. 

Administrative charge recommendation:                                                                             100%